Ocal Inc. Reports Second-Quarter Results
VAN NUYS, Calif.--(BUSINESS WIRE)--Aug. 7, 1998--Ocal Inc. (Nasdaq:OCAL), Friday reported net sales of $6,431,000 for the second quarter of 1998, a 1 percent increase compared with second-quarter 1997 net sales of $6,350,000.
Net income for the second quarter of 1998 was $303,000, or 5 cents per share, a decrease of 25 percent compared with second-quarter 1997 net income of $402,000, or 7 cents per share.
"Our second-quarter 1998 results were below our expectations, primarily due to pricing," stated Ilan Bender, Ocal's president and CEO. "The competitive nature of the marketplace required us to price aggressively to increase our market share.
"Our volumes were up approximately 3 percent overall, but we gave significant price concessions on one overseas order and also on initial orders from three new Ocal stocking distributors."
Bender continued: "Our gross margin percentage was 25.6 percent for the 1998 second quarter, compared to 27.7 percent during the year-ago period, again due to pricing pressures. Labor and overhead costs were in line with the year-ago period and material costs were basically flat."
Bender added: "We are continuing to focus on our most important competitive advantage, which is our low-cost, high-quality production capability. We are making progress in certain factory improvements, which we believe will reduce material and labor costs in the latter part of the third quarter and in the fourth quarter.
"We are also closely monitoring our selling and administrative expenses. The second quarter of 1998 reflects approximately $50,000 of nonrecurring expenses relating to the settlement of a lawsuit. Excluding those expenses, we limited our growth in selling and administrative expenses to 2.8 percent."
Ocal, founded in 1965, is a leading domestic manufacturer and marketer of polyvinyl chloride (PVC) coated rigid steel conduit, elbows and fittings. The company markets its products as the preferred long-life technical solution for protection of electrical wiring systems in highly corrosive environments. |
